Leaks about top presenters' salaries show the BBC will be able to "outgun" other broadcasters if the licence fee is raised, the Tories have warned.

The BBC wants the licence fee, which accounts for much of its funding, raised from £131.50 to £180 by 2014.

Shadow culture secretary Hugo Swire told MPs public support for the BBC could be undermined by high fee rises.

Minister Shaun Woodward urged MPs "not to play politics" with the BBC, one of Britain's "most trusted institutions".

'Spiralling salaries'

The Commons debate came as the government prepares to renew the BBC's charter.

The BBC wants approval for increasing the licence fee by 2.3% above inflation over seven years.

But Mr Swire warned: "An over-funded BBC will lead to a spiralling of salary costs.

"Recent leaks over the level of pay for presenters only adds to the argument that too generous a settlement will damage the broadcasting sector and could lead to the BBC outspending or outgunning the opposition in a hunt to bag the star names."

He said chat show presenter Jonathan Ross was only worth his reported £18m three-year BBC contract in a "parallel universe".

He added: "The scale of the BBC's online services is now so considerable that it is increasingly absurd to group them together under one service licence."

Mr Swire told Culture Minister Shaun Woodward: "There is a huge support among the public for the BBC. But an unacceptably high level for the licence fee will surely undermine that support.

"Do you not accept that a settlement in excess of £180 will simply be too high for many families on low incomes?"

'Unique affection'

Mr Swire also criticised the negotiations over the licence fee for lacking transparency and being "dogged by delays and uncertainty".

That claim was denied by ministers, who said they had never set out a specific timetable. Mr Woodward insisted the government was carrying out "the most comprehensive and open" review in the BBC's history.

"The purpose for us was clear from the beginning and remains our guiding principle - to deliver the BBC the public want - strong, independent - and we recognise that the BBC has a unique place in the esteem and affection of the country," he told MPs.

"It is one of the most trusted public institutions in the country, and it is an institution with which we have all grown up."

Too dominant?

Mr Woodward, a former BBC producer, tried to quell concerns that the new licence fee would be too high.

"May I offer reassurance to opposition MPs who are concerned that the BBC might actually have a larger than necessary licence fee settlement," he said. "It's very simple: it will not."

John Whittingdale, the Tory chairman of the Commons Culture, Media and Sport committee, said the BBC was asking for major funding rises as other broadcasters were having their revenues squeezed.

"The BBC is already by far the biggest player and an increase of this kind will distort the market further and place the BBC in too dominant a position," he said.

Liberal Democrat culture spokesman Don Foster said the proposed fee was too high, despite the need for the BBC to remain the "best in the world".

He criticised the government for asking the BBC to fund the costs of the switching from analogue to digital broadcasting.

He accused the government of mounting "simply a smash and grab raid, yet another stealth tax".